Brazil Resources Inc. Stock Rebounds After Gold Surge and Colombia Acquisition

Gold futures were on the rise in recent days with August economic reports of U.S. activity showing disappointing job-growth and manufacturing numbers. This led to some dollar concern, although the European Central Bank’s subsequent decision to stand pat on monetary policy has eased the rush to gold as a safety net.

Still, several international gold company stocks have gotten a boost of late, including Brazil Resources Inc, which recently acquired a large mining block in Colombia. It has since slid, but its shares initially jumped 20% after the U.S. economic data came in to put it up more than 500% for the year, according to business news outlet Financial Buzz,

After sitting at $0.52 AD per share on March 1, the stock began to climb. It hit a high of $3.0o CAD on July 6 before losing steam and dropping back to $2.04 CAD per share. But since the announcement of its Titiribi property acquisition in central Colombia from Sunward Investments, a NovaCopper Inc. subsidiary, on September 1, Brazil Resources’ stock has been rebounding again. The share price sat at $2.70 CAD in mid-day trading today.

“We are very pleased to complete the acquisition of the Titiribi project, which we anticipate will deliver significant value accretion to our shareholders,” said Amir Adnani, chairman of Brazil Resources Inc. “The company continues to execute on its stated mandate to uncover opportunities and acquire quality gold assets.”

While the acquisition should keep the market rosy for Brazil Resources Inc, the recent gold surge generally may be short lived. Gold futures have dipped for the past two days, and investor consensus has been moving further towards the likelihood of no Federal Reserve rate hike at its next meeting.

“Wage pressure is scant. Inflation pressure is negligible. Housing is slowing because a labor shortage is impeding building of new homes. Demand for credit is sluggish but persistent,” commented Gary Wagner of The Gold Forecast, per Marketwatch. “That adds up to no rate hike in September, unless enough theoretical thinkers override the pragmatists. There probably will be no rate rise in December either unless somehow Inflation breaks out like a raging bull.”

In addition to its recent Colombian acquisition, Brazil Resources maintains exploration and development projects in Brazil, the United States, and Canada.